What Is Positioning in Marketing? 6 Positioning Strategies Used by Brands

What Is Positioning in Marketing? 6 Positioning Strategies Used by Brands

When you talk about your company or products, what do you usually highlight? Do you focus on the outcomes your customers can expect, like increased sales? Or maybe you talk about the category you're in, like custom software development? Do you target a specific audience, like business owners? Or perhaps you emphasize the cost, like offering a premium service? If you haven't guessed already, in this article we're going to dive into positioning! So, let's get started!

What is the place that your brand occupies in the mind of its target audience? This is how Al Ries and Jack Trout identified the concept of positioning in their book "Positioning: The Battle for Your Mind," which was published in 1981. They didn't invent this term but they did make it their trademark.

The origins of the positioning concept are a bit murky. Some experts say that ideas like market segmentation and positioning were important in brand advertising as early as the 1920s. But these concepts didn't appear in marketing textbooks and journal articles until the 1950s and 60s. Around this time, advertising legend David Ogilvy was using the positioning concept in several of his campaigns. 

In his book "Ogilvy on Advertising," Ogilvy talked about the Dove campaign he launched in 1957 and explained, "I could have positioned Dove as a detergent bar for men with dirty hands, but chose instead to position it as a toilet bar for women with dry skin. This is still working 25 years later." 

I have a video on David Ogilvy and what copywriters can learn from his timeless marketing advice. Make sure you check it out after you watch this video. I'll link to it at the end.

Ogilvy's definition of positioning is "what a product does, and who it is for." It's a bit different from what Trout says and what is considered to be an industry "standard." 

Trout said that positioning is not about what your product does, but how it's perceived by your audience. He believed that to succeed in positioning, you need to differentiate yourself from competitors with a clear and concise message that communicates your unique value to your target market.

Watch it instead:

A formula for writing a positioning statement

Based on what we already know about positioning, here are five things you need to do to create a positioning statement:

  1. Define your market. Split it into meaningful groups based on their characteristics, wants, and needs.
  2. Understand the market need in your specific category.
  3. List the key benefits that your brand delivers to a specific target segment. In other words, get the answer to the question "Why should people buy from you?"
  4. Analyze your competition and determine how you differ from them.
  5. Pack this all into a single positioning statement.

Here is a formula you can use:

"For [target customer] who [need], the [product name] is a [product category] that [key benefit – (a compelling reason to buy)]. Unlike [primary competitive alternative], our product [primary differentiation]." 

Following this formula, let's create a position statement for a hypothetical copywriting agency:

And here is a real example of Volvo's creative brief based on its positioning statement from 1997:

"Within the prestige vehicle category, Volvo positions itself as a car offering superior safety and performance."

Here goes the brief:

To upper-income, other brand switcher car buyers [target audience], Volvo is a differentiated brand of prestige automobiles [marketing strategy], that offers the benefits of safety [problem removal]  as well as prestige [social approval]. The advertising for Volvo should emphasize safety and performance and must mention prestige as an entry ticket to the category. And will downplay its previous family-car orientation in the interest of appealing to a broader range of users. [Message strategy] 

Volvo has been known for its safety features for ages. And today, the brand is also focusing on being reliable and sustainable. They're even planning to go fully electric by 2030! Safety, reliability, and sustainability are what set Volvo apart from other cars in its category.

How do you differentiate?

A memorable position in the market depends on differentiation – something you need to define if you want to create a unique selling proposition (USP) that sets your product apart from the competition. 

Maybe it's the first of its kind, or it's the cheapest, or it's the most flexible – there can be lots of things that make your product different – but that doesn't mean they are all important to your target audience. When you're trying to define a distinguishing factor, make sure it's relevant to the people you're trying to reach, and speaks to their needs.

Marketers use differentiation to shape product perception

There is one thing I want you to take away from this blog post: Differentiation is the key tool that marketers use to influence how their target market perceives their product or brand. Whether it's through the design of the product or the way you promote it, you can influence what pops into your audience's head when they hear your name or see your logo.  

Let me give you an example of how one of my clients used differentiation to influence the perception of their brand. 

I work with Highlight QA, a video game testing company that wanted to stand out from its competitors. Rather than relying on the tired old differentiator of "high-quality games," they chose a positioning strategy that emphasized their purpose and values. They wanted to be known as a people-first company, one that prioritized empathy, a positive atmosphere, and diversity. By emphasizing their purpose and not just the outcome of their services, they aimed to set themselves apart from competitors.

To bring this to life, they designed a website with vibrant colors and a great UX. They also created a style guide for all their marketing materials that reflected their values and highlighted the people-first approach. By differentiating themselves in this way, they created a unique and memorable brand identity that resonates with their target audience.

6 common positioning strategies

Purpose-driven positioning

Differentiation by purpose or the reason ‘why’ a brand exists beyond the desire to make a profit is the latest incarnation of brand positioning. This trend gained popularity among companies after Simon Sinek did his famous Ted Talk about his book, Start with Why. 

Now let’s see if you can guess what brands these purposes belong to:

  • "To accelerate the world’s transition to sustainable energy."
  • "To save our home planet from climate crisis, so that we can remain vigilant, and protect what’s irreplaceable."
  • "To organize the world's information and make it universally accessible and useful."

Want to check if you guessed right? Follow me on Instagram. I’ve written about it in one of my posts. 

Now let’s explore five more examples of positioning strategies for B2B companies to get your creative juices flowing.

Cost-driven positioning

Who doesn't love a good deal? Cost-driven positioning is when a business offers its product or service at a lower cost than its competitors. 

Budget airlines like WizzAir, retailers like Walmart, cloud computing platforms like AWS – there are plenty of examples of brands that use this strategy.

Unless you want to sacrifice quality or profits, cost-driven positioning is not an easy strategy to pull off. The trick to making it work is to have a competitive advantage – like having access to cheaper materials or a more efficient production process.

Niche service specialization

Another type of positioning strategy is niche service specialization, where a company focuses on offering a specialized service to differentiate from competitors and attract customers who are looking for specific expertise.

For example, some digital marketing agencies are full-service. They provide marketing services for all channels and platforms, including email marketing, content marketing, PPC advertising, video marketing, and more. These full-service agencies are like a one-stop shop for all your digital marketing needs, and they can help you create a comprehensive strategy that covers every aspect of your online presence.

On the other hand, some agencies prefer to specialize in just one or two areas, like social media marketing or SEO. While they may not offer the same breadth of services as full-service agencies, they can provide a deeper level of expertise in their chosen field and may be better suited to certain types of projects or clients. 

For example, Kaiiax, the company I co-founded, focuses exclusively on SEO and content marketing for software companies. Unlike other marketing firms, we do not offer services in social media marketing, email marketing, or advertising, and don't work with just anyone seeking SEO – this sets us apart in our niche.

Industry specialization

Instead of being jack-of-all-trades, professional services firms can hone in on a specific industry and become masters of their craft. For example, a law firm with expertise in environmental law can offer legal advice and representation to clients in the environmental industry. A software development company that has built healthcare applications can offer specialized services to healthcare providers, like developing electronic health record (EHR) systems or medical practice management software. 

By focusing on a specific industry, a company can build a reputation as an industry expert and develop a deep understanding of the unique challenges and opportunities faced by its clients. This allows them to provide a level of expertise and service that generalist firms may not be able to match.

Plus, by narrowing their focus to a specific industry, professional services firms can optimize their marketing efforts and become known as the go-to firm for clients in that industry.

Role-focused specialization

“We help product designers succeed” is an example of role-focused positioning. It's when you're targeting a particular function in the organization such as CEO, CTO, or head of finance.

By targeting specific roles within a company, you can create a strong bond with your clients and make them feel like you really "get" them and can provide targeted solutions that make their job easier.

Stripe, a worldwide payments company, achieved early success by catering directly to the developer community. Its focus on making developers' lives easier played a significant role in acquiring customers.

Value-based positioning 

Companies can position their products or services based on the benefits they provide to other businesses, such as increased efficiency, cost savings, or improved productivity. For example, a software company could position its product as being able to streamline business processes and save time and money for its clients.

A logistics company could position its service as being able to provide faster and more reliable delivery, resulting in improved customer satisfaction and repeat business for its clients.

To use this strategy, you need to identify the unique benefits and features of your product or service that can provide superior customer satisfaction. 

For example, Amazon currently has a customer-experience-led positioning and mission: “Our mission is to continually raise the bar of the customer experience by using the internet and technology to help consumers find, discover and buy anything, and empower businesses and content creators to maximise their success.”

Key takeaways

  • Positioning is a mental concept. It is not about what your product or service does, but rather how it is perceived by the consumer in relation to your competitors.
  • To effectively position a product or service, you need to have a deep understanding of your target market and their needs and preferences. 
  • Positioning involves differentiation: To effectively position a product or service, you need to differentiate it from competitors in a meaningful way. This could involve highlighting unique features or benefits, or positioning the product as being better suited for a specific need or use case.
  • The way a product or service is perceived by the consumer can be influenced in many different ways, including advertising, word-of-mouth, and personal experiences.
  • Positioning is not a one-time effort, but rather a long-term strategy that involves consistently communicating the unique value your product offers across all marketing channels.

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